Reference no: EM132605322

Question 1: Trex Manufacturing decorative doors are preparing for next year's operations. The Management have developed the following estimates. Help the company determine their contribution margin in both units and ratio Break even in dollars and units, Margin of safety in percentage and amount (, and if the management have decided that the company's traget net operating income is $860,000, determine the degree of operating levearge)

                                                 Total                        Per Unit
Sales (40,000 units)                     $ 2,000,000                $ 53
Direct Materials                              $ 210,000               $ 12
Direct Labor (Variable)                        $ 50,000               $ 4

Manufacturing Overhead:

Variable                                             $ 60,000               $ 6
Fixed                                               $ 55,000                  $ 6

Selling & Administrative:

Variable                                              $ 95,000               $ 8
Fixed                                              $ 40,000                  $ 3.50